Gaming technology and services provider Nektan has achieved EBITDA break-even, buoyed by growth within its European arm.
Revenue in the six months to December 31, 2018, was up 48 per cent year-on-year to £13.02m (£8.81m).
Adjusted six-month EBITDA of £336k – compared to a loss of £916k the previous year – was driven by increased revenues and resulting business efficiencies, the company stated.
Nektan’s US operations have been classified as discontinued following the proposed sale of subsidiary Respin, which is expected to net the firm £2.9m by the end of April.
The launch of new white label casino partners, notably the Shipley Brothers, has taken the number of fully managed global casino brands to 152 across Europe, while Nektan’s higher-margin B2B division was a significant global revenue driver with 10 partners live by the end of 2018.
With Lucy Buckley joining as CEO in December 2018, the directors remain in discussions with HMRC in the UK for the £2.9m owed for the point of consumption tax, which is mitigated by equity fundraising and the Respin sale.
Buckley said: “Achieving EBITDA break-even during the period is a key milestone for Nektan and our key focus for the remainder of FY19 is on maintaining and improving profitability. EBITDA break-even was reached due to both increased revenues and operational efficiencies. Whilst we believe in our US mobile casino product, and are excited about the macro trends in the market, the proposed sale of the majority shareholding of our US subsidiary is a major contributor to our profitability plan by removing Nektan funding for the US going forward, but retaining a material stake in the emerging US market.
“In Europe, Asia and Africa, our emergent B2B division is generating new high margin revenue by licensing our proprietary technology to leading operators. We are successfully attracting major casino and gaming partners as evidenced by our BetVictor launch in October 2018 and post-period end contract win with MoPlay, announced in March 2019. This growth was only achievable with the firmly established B2C and white label network which grew to a record total of 152 casino sites during the period.
“All this is underpinned by our cutting-edge proprietary mobile casino technology and agility, allowing us to attract new partners, get live quicker and optimise their revenues with our advanced operational and promotional tools. Nektan is in a strong position to build on the success of the first half of FY19 and we look forward to providing further updates.”
